The stonedinvestor likes banks about as much as funerals. This is stuff you pay people to pick they are all so familiar and boring. Every now and then a small one catches my eye and that is the case with a bank from San Franciso's Chinatown- UCBH Holdings. UCBH already has a branch in Hong Kong and they have boosted assets to the required $10 billion mark...next stop China. Obviously ties run deep between UCBH and China with many Chinese over here sending back funds etc. The goal: take China from 2% of total earnings to 20% in five to ten years. Friedman Billings Ramsey has it as there top pick in small caps! When you get a bank into your portfolio and it just happens to be a top pick in small caps: congratulations you are stonedinvesting! I went through the recent earnings report and I REALLY liked what I read. So did S&P. ? 01/26/07 11:59 am EST... S&P REITERATES BUY RECOMMENDATION ON SHARES OF UCBH HOLDINGS INC. (UCBH 18.53****): UCBH posts Q4 EPS of $0.27 vs. $0.26, $0.02 below our esti- mate. 13% loan growth during the quarter is well above our forecast, and credit quality was strong, with non-performing assets at 0.15% of total. The company forecasts 14%-16% loan growth in '07, and $1.13-$1.15 EPS. We are re- ducing our '07 EPS estimate to $1.15, from $1.20, on flat yield curve pressure we expect. however- er, we are optimistic about UCBH's international- al growth strategy and credit quality, and are keeping our 12-month target price of $22, based on a premium-to-peers multiple of 19X our '07 . That little downer bit about the flat yield curve- that could become a positive tailwind at some point- if the Fed sticks to his guns. I'm buying today. ~ stoney
12 month target $22 and we are at $20 already Folks in a month. Is this wrong? Out of proportion? This pick has far excelled the financial sector and the broad market- is there any reason to sell it? I don't think so but you know there is this sub prime thing that does affect banks and brokers and who knows who else-- These spreads on bad debt some folks are in deep and it could unwind in a nasty way-- not for UCBH I don't think and it's off to China we go ! Heidi Ho. what a great call this was!